Tenants Facing Foreclosure

Another story popped up in the Sacramento Bee recently about tenants facing foreclosure.

I had written about it when the first tenants were being foreclosed on last year.

Hey, maybe you should read this blog first!

Sacramento's I-5 Project Begins Tonight

If you travel to downtown Sacramento or will be using I-5 on a regular basis, go here for details on the repairs and to plan your commute.

Fannie Mae, Freddie Mac Revise Policies

This just in from Darin Marquardt of Chase Home Loans:

Fannie Mae and Freddie Mac have recently announced that they are eliminating their declining market policies beginning June 1st. Additional details will be provided when they are received from the Agencies. It is important to note that the mortgage insurance companies still continue to underwrite loans to their declining market polices, so MI restrictions will still apply for now. In light of the Agency announcement, Chase plans to eliminate the Agency declining market policy in an upcoming release. Until further notice, loans should continue to be decisioned per posted policies and product guides.

To get prequalified, click here.

Landlords Beware!

There's a new scam out there. If you're a landlord like me who advertises on Craigslist and VFlyer you should watch for this story: the so-called tenant will usually approach you by email saying they are from the UK or some other foreign country. They inquire about the property and the rent. (This should be the first red flag since both the property address and rent is clearly displayed in the rental advertisement.)

The rest of the story goes something like this: "Someone in the US owes me money, so they will pay you usually an amount much higher than the deposit and rent. You then have to deduct your amount and pay me the rest, so I can actually fly into the United States." Sound familiar?

It should. Here's what will probably happen: The check the person who owes them money will send you might look good, but will bounce. You will be required to wire money to the so-called tenant.

Why does this work? Because banks are required to make deposited funds available to you within 48 - 72 hours. You might think the check has cleared and be tempted to wire money out of it to the tenant. They might even come up with some story about how they need the money urgently. The actual money takes about a week or more to clear. In which case, you will have already wired the cash and the check will bounce.

In the world of scams, it might seem petty, but will still cost you about $2000 - $3000, plus bank fees for overdraft, bouncing checks, and so on.

So what can you do? For one thing, don't offer to take money from anyone but the person who is renting the place. Do not agree to any exchange of money - you're the landlord - you should be getting paid, not sending anyone anything. Secondly, you want to run a background check and credit check on anyone renting your home. Even if they say they don't have a social security number, you still want to take down their full name and details. Ask if you can mail them an application and charge an application fee. That will tell you how serious they are.

Be extremely careful with email only inquiries. If possible, set up an interview with the potential tenants. Listen to your gut. Remember you are renting an asset to them and you need assurance that they are real.

Waiting for Prices to Drop 30%?

In recent months, I haven't spoken to too many real estate buyers who are waiting for prices to drop another 30% but there were a few last year. As it turns out, these Chicken Littles awaiting this kind of disaster are few and far between. As many numbers show, prices are heading toward stabilizing in the Sacramento market, sales are up and inventory is down, even the Sacramento Bee was surprised by the numbers and first-time buyers are entering the real estate market and Greenspan called the housing bottom nationally.

But for the rest of the doom-and-gloomers, here is a very interesting article to read about how the Case-Shiller index that the media keeps playing up as "the best gauge of home values" has a reason to be pessimistic - it has relationships with hedge funds on the side. So much for the Chicken Littles talking about Realtors with bad ethics and conflicts of interest.

Sacramento Real Estate Gal Shakeup and the Truth about Cats and Dogs

In spite of the fact that we're having a baby, my husband and I decided to get another cat. Actually, I decided it - he just thought it wouldn't be such a bad idea. Since moving from Sacramento to Pollock Pines, the number of cats we have has gone down from three to one. So, we get Fuggles. We also have a dog.

But besides the fact that they are cat and dog, there is one major difference between these two and that is this: for entertainment, Fuggles will irritate and aggravate things, people and animals around her. The carpet, the dog, the other cat, even us. The dog will just look morose and hope to be noticed.

But where am I going with this? Don't worry - I haven't finally just lost it.

I'm finally beginning to understand the beauty of Fuggles' world. When you feel like you're stuck in a rut, you just have to shake things up - even if it means aggravating everyone around you. Thankfully, the changes coming to Sacramento Real Estate Gal shouldn't be too aggravating - but I am shaking things up a bit.

For one thing, when you contact me, I have now opened up the floor to other Elite Properties agents. So don't be surprised if someone else besides me contacts you to follow up. This way, you know you have a great Realtor working for you regardless of how busy I get and your request does not get ignored.

For another, please subscribe to the blog! I have made a personal commitment to write more often and regularly. So if you enjoy this blog, please pledge your support by subscribing!

I have also noticed that other Realtors seem to enjoy reading this blog, so for all my associates out there, I'm adding a new feature "Realtor Book of the Month." This will feature one book a month that helped me in my real estate business. You can then buy it right here from Amazon.

Fuggles would be proud!

Sacramento Property Taxes Fall Again!

Some homeowners are seeing their property taxes falling again. This time, they are told, the reduction is temporary and the result of market value being lower than assessed value, especially if they have bought the home around 2004 - 05.

The real estate taxes will not be refunded. However, the homeowners will receive a lower tax bill for the 2008-2009 ta year.

Check your mail for the latest details. Many Sacramento homeowners have already received this letter from the assessor.

Things to do in Placerville

If you find yourself in Placerville with nothing to do, here are some tried and tested ways to entertain yourself:

There is only one movie theater, but they do have art movies showing usually every Monday. Check at the counter.

Head downtown! You can easily spend a few hours there browsing art galleries and shopping. While there, visit The Bookery. If you like used books and great prices, you'll love the place!

If you're into beer, visit Jack Rusell Brewing Company. Ask for a private tour of their brewing facility. The guys usually like this part. And for the women, visit The Wine Smith - again in downtown Placerville! (Next door to The Bookery) If you happen to be in Placerville on the third Thursday of the month, stay a little longer at The Wine Smith for the monthly HAZE club meetings. Taste beer, learn about brewing it - hey, you might come back!

Need I say more?

Where else but in Pollock Pines...

... can you get beautiful rainy weather like this? No, I'm serious. It's about 45 degrees outside and wet. Lovely day to curl up with a book - or as in my case - a laptop.

Considering being a neighbor and buying a home up here at 4000 feet? Browse these.

Memorial Day Video

Please take a minute or two today to think about and thank the real heroes.

House for Rent!!!

2 Bedroom, 1 Bath home available in two weeks. This is my personal property. Rent is $1000 per month with $1200 deposit. Section 8 okay!

To see the address and other details, please go here or call me at 916-712-4255.

Will HUD Please Make up its Mind?

As part of my recent attempt to get over my fear of learning new things and trying to rent one of my rentals as a section 8 rental, I have been on the phone with HUD and the Sacramento Housing and Redevelopment Agency about three times now. Here's the interesting thing: every time I have heard a different story. The first time, I was told I had to do nothing. Just register your rental and wait for an SHRA agent to call you for a "briefing." Second time, no agent was to call me, but I would receive a "briefing packet in the mail." Today, when I called (the last time so far) I was told there was no briefing packet... "and why would an agent call you?" Instead I have to attend a Landlord Orientation.

Everyone I had asked about renting out my house as a Section 8 rental had said, there's nothing to it!

I'm not giving up yet. Maybe there's more work on the front end and lesser later. At least, I hope so.

Another Reason to Buy Real Estate in Sacramento

Just the other day, I spoke to a client who is getting married this weekend and will be buying a home to start their lives together in our very own Sacramento. If you're raising a family here in Sacramento, you're in good company. Best Life editors just ranked Sacramento the 29th best city to raise a child.

Read all about it here.

The results were based on the U.S. Census Bureau, National Center for Education Statistics, FBI, American Association of Museums, National Center for Health Statistics, and the American Bar Association.

Another Great Short Sale Article

Maybe the reality of short sales - neither short nor sales - John's by now famous quote is finally beginning to sink in. Most traffic to this blog comes from Google search and here are some of the search terms people are using: "Buyer's rights short sales;" "Short Sale Addendum;" "Short Sale Buyers" and so on.

I think this points to a definite uncertainty in the market relating to short sales. Buyers don't know what to do or expect when faced with a short sale. Sure, the price seems interesting in the beginning, even enticing. And they think they have the patience to wait it out.

Here's another excellent article which points out why they are better off staying away.

Foreclosure Filings Up... and Why this Might be a Good Thing

Yahoo recently reported that foreclosure filings are up 65% from last year's numbers in April nationwide. The last time we had such record numbers of foreclosures was in August 2007. While I am not thrilled about the individual effect this has on the families involved, I am glad that this is happening on an overall market scale and especially for Sacramento.

Really, you say. But aren't foreclosures bad for prices? Yes. And yes. But foreclosures are bad for prices in the short term. Foreclosures however are not bad for sales.

The real problem in the Sacramento market as I see it? Short sales. Not convinced? Okay, onto the reading material!

Here's an excellent article on Sacramento-home by John Lockwood that talks about how short sales are neither short nor sales. Elsewhere, he mentions that any given time 5% of all short sales on the market actually close escrow. I have also written before about how life would be a lot easier if banks just foreclosed on these defaulted properties. It is not the foreclosures, but the short sales that are skewing prices, often because agents are forced to list them at ridiculous prices that will never get approved by the bank in an effort to remain competitive.

Foreclosures would solve all these problems. That, and me deciding not to take on any more short sales or buyers who want to see them. With a 5% success rate, ask a sports fan - What's the odds? And I'm not the gambling kind.

Learning about Section 8

Now that my rental house is available again, I've decided to put my fear of learning something new aside and try to put a Section 8 tenant in it. Apparently, Section 8 is the old term - the program is now called Housing Choice Vouncher Program.

With this program, from what I've heard so far, you register at Sacramento Housing and Redevelopment Agency as a landlord with an available residence for rent to a tenant on public assistance. Then the agency calls you a few weeks later for a briefing and you're free to take on a Section 8 tenant who brings you a voucher. From then on, HUD pays you the rent, the tenant pays the deposit.

You are still however responsible for screening the tenants and it is a good idea to do so especially because they will be in possession of your house. I hear there is a minimum lease requirement of one year, but I guess I'll find out all the details at the briefing.

If you are a landlord of a house in a low income neighborhood, this might be the way to go. Start here. Or here.

Inspiration for Real Estate Investors

I came across this wonderful article while reading MSN Money. It's definitely worth a read for those of us who are invested in the market and wondering when it's going to turn around.

Although it relates to stocks, I think it is still an inspiring and uplifting read. Remember: have a plan and follow it doggedly.

Sacramento County Condo Update

Sacramento condos for now anyway seem to be stabilizing in terms of price. For the last update, we had settled at a median selling price of $138,500. In April, the median price fell another 2.5% to reach $135,000.

100 condos sold in the month of April, an improvement over the 90 that sold in March. Pending sales are at 121 for the month of April.

There are a total of 640 condos for sale in Sacramento county, including 151 new listings which came on the market in April. This brings Sacramento county's condo inventory to 6.4 months.

Market Statistics for Single Family Residences - April

Wow... time really got away from me, didn't it? I completely forgot about the beginning of the month statistics for April. Well, better late than never. Here they are!

Median price has fallen again over last month to $235,000 from $254,000 - a drop of 7.48% However, sales increased by 42.64% over last month. 1429 homes closed sales in April as compared to 1006 in March of this year.

That brings inventory down even further to 5.8 months from March's 8.5 months.

1882 homes went into escrow in April.

Follow the market: March's numbers; February's numbers; January's numbers.

Changes to Comments

Some changes are occurring at Sacramento Real Estate Gal! If you've noticed I am no longer allowing anonymous comments to this blog. I have also added a security feature which requires you to copy a word to be able to post a comment - this is all in an attempt to step up security on this blog and my professionalism in general.

Enjoy!

Greenspan Calls Housing Bottom

Alan Greenspan, former head of the Federal Reserve, has predicted that housing will hit bottom at the beginning of 2009 when the market absorbs the excess inventory. He is, of course, talking about housing prices nationally.

Sacramento might already have hit bottom. Anecdotally, I see a lot of pent up buyer demand for bank-owned homes. Once the excess inventory gets bought up, watch the prices rise!

"So, what's going on with the real estate market?"

"Dear Sacramento Estate Gal: What's going on with the real estate market? Thanks, Everyone You Know Who Isn't a Realtor."

Well, you might as well ask. What's happening isn't great - if I have to liken it to having a baby - and I do liken everything to it lately - it's a little bit like the first trimester. It makes you feel nauseated and not quite all right, you have no sense of the baby moving at all, so you don't feel pregnant, but it's still fun to wait and watch.

And then there's the worrisome AFP screening to get through, so you're praying everything will be all right in the end.

But seriously, here's why a lot of business has dried up:
- many buyers who want to buy can't - there are no zero down loans (for now)
- many buyers who want to buy and can can't make up their minds about prices and how much to pay
- too many buyers are interested in deep, deep discounts
- move up buyers (those who want to sell and buy) are stuck competing with foreclosures
- and lastly, those darn short sales don't help comps.

So now you know. (Need I remind you first-time buyers that I told you this would happen and that last year was the time to buy?)

But I'm still holding on to unshakable optimism that history will repeat itself and everything will be all right in the end.

Upcoming Real Estate Book Reviews

After reading and admiring much of "Retire Rich from Real Estate" and writing this review, I now have two other books I will be reviewing over the course of the next few weeks: "The House Flipping Answer Book" and "The Real Estate Investing Answer Book" both by Denise L. Evans.

Feel free to browse through and read them before the reviews!

Real Estate Lessons from a Baby Shower

Saturday was a whirlwind. And although I promised not to call it a baby shower (too many connotations) and wanted to go with the more non-traditional baby "party" it did turn out to be a wonderful and perfect day filled with some of my favorite people in the world. Sometimes you just have to sit back and count your blessings.

But as a blogger, and as a real estate blogger nonetheless, you also have to see how you can draw inspiration and meaning from it for the investors and the home buyers. So here are three of my bigest real estate lessons from the baby party-shower-whatever-you-want-to-call-it:

1. Invite people to share the joy, not to brag - I think too many people tend to gloat when they are successful. How many of us have heard about the investor who hit the good times with that one solid investment property and then bragged about it for the rest of his life? How different would it be if he just shared the joy of it with his closest friends and family?

2. You really can pick your neighbors - Sometimes you have no idea they're so wonderful, though. My neighbor did all the work for this party. And I mean all. She decorated the house, brought serving dishes, prepared some dishes, bought the baby cake, and cleaned up afterwards (and a million other things I can't think of right now). I don't know what I did to deserve her, but thank God for good neighbors!

3. Remember what's important - I have a very strong sense of time passing since we decided to have a baby, so I have no interest any more in wasting my time or thoughts on people and things that don't matter. In the past, I've engaged in conversations and arguments with real estate nay-sayers on this blog, but no longer. There are too many great people and beautiful things in this world and the time to enjoy them is too short, so I'm just going to focus on having a great time!

Sacramento #42 for Allergies

If you think you're imagining it, you're not. Sacramento was recently ranked at Forbes.com as the #42 worst city for allergies. And if you're new to this city and thinking, I don't know what the fuss is about, wait a year or three. It will get to you! I thought everyone around me was insane too when I moved to Sacramento from Bombay almost eight years ago. Now I know better.

Where is Sacramento Real Estate Gal?

If you've been wondering at the lack of posts lately, both here and at Sacramento-home, it's because I've been on a week-long vacation. The real estate business always promises to pick up around Memorial Day, so I thought now was just the perfect time to take a break.

Yes, I'm still on vacation (technically) but still writing. How's that for dedication?

So what am I doing? I went to Fresno for about three days to see some friends of mine that I will probably not see for a while, what with baby coming and all. And tomorrow, we're having a baby party.

For someone so tiny (she's apparently 2 pounds by now) she sure is commanding a lot of attention, stuff... and real estate in the house!

If you're Watching Mortgage Rates...

... this post over at the Mortgage Reports Blog might interest you.

Dan Green writes often about mortgage rates and his posts are almost always educational. Not a bad blog to add to your subscriptions!

Relocation Buyers: Have a Baby, Make New Friends!

What better way to feel at home when you buy a new home than to have a baby? That's what I've discovered anyway. Since we moved to Pollock Pines last summer, I've been longing to find a community and new friends where we live. And just lately, it's been a lot easier. Reason? I'm pregnant and beginning to show. And now I have friends everywhere. People have come out of nowhere to help and be nice.

Yes, having a baby changes everything. But just in case procreating isn't what you want to do to ensure you have more friends, check out these other options:

Talk to More People - Visit your local grocery store and talk to anyone who will listen. If you're in business for your self, this behavior is called networking. But you can always use it if you're new. People are extremely willing to show you around or help you with locating a store or services - if you only ask. Let them know you're new. Then watch them offer to help.

Throw a Meet and Greet Party for Neighbors - This one is fun. You can invite your neighbors to your housewarming party if you choose. Really, with food and drinks, who is going to stay away? And it's a great way to get to know your neighbors.

Check the Local Boards at the Grocery Store - Maybe it's because I'm a woman but I really do think grocery stores are huge socializing place. Some will have flyers and brochures on local events at the entrance. If they do, check them out - you might find ways to get involved in your new community and make some friends that way.

Check for Local Clubs - Volunteer or Otherwise Check online for clubs in your new neighborhood. You'll almost always find something. Some might be volunteer like the Rotary Club or Lions Club, a great place for establishing community friends. Others might be more specialized. Since my husband likes to brew beer, our local club - the Hangtown Association of Zymurgy Enthusiasts - HAZE for short - gives us an excellent opportunity to make more friends with common interests.

Whatever the strategy, it's important to talk to more people when you move. Do not stay home or just hide in your house, no matter how much you love it!

How Hard is it to Sell... Really?

I've always maintained with my real estate clients that they should be more interested in buying a property than me in selling it to them. If at any moment I notice that I am doing anything more than facilitating a transaction, I wonder about their motivation, and eventually, their passion for actually getting the home they claim to want.

Why the question? Because I went to get my snow tires replaced with regular summer tires today and I got a lesson in sales.

Amazing the places you learn things!

So here's what happened - I went over to Walmart Tire Service thinking I'd get it done cheaper than Big O. After waiting for about ten minutes while the staff bickered amongst themselves (well, you get what you pay for, so I thought, oh well...) a lady comes out from behind the counter to ask how she can help.

"I'd like to get my snow tires replaced with my summer tires."

After that, she proceeds to take down my phone number and name and then says, "I need to see what tires you have."

When we get to the car, she realizes that I already have tires and after a moment of staring at me blankly, says, "Oh, you want them changed out."

I guess "replaced" has been replaced with "changed out" in WalMart territory.

Anyway, she stares at the tires and says the tread looks bad... "and you're pregnant." As if that needed to be pointed out. So she calls another guy from the staff to look at them. He says they would need to be replaced soon, but they're fine for now. But Miss Sell-Me-Tires is adamant. The tread is bad; if it was up to her she wouldn't do it.

"Why don't you just come back when you want to buy new tires and we'll change them," she says. "Now it will cost you more."

Now, I'm dreading the idea of driving around in my snow tires any longer. And if the law says they're safe for now, they're safe for now! But by this time I'm so tired of the woman's holier-than-thou attitude that I decide to leave and head over to Big O, even at the cost of paying more.

Yes, this story does have a happy ending: Big O replaces my tires, no questions, no comments, no "let me run your life for you" attitude. They also give me a discount because I've been a customer there before - and the whole thing costs less than it would have at WalMart. How's that for wanting to save a few bucks?

The story also has a moral: Within the law, do what the customer asks you - don't badger her with a holier than thou attitude to act like you care. Contrary to popular belief, it's not considered professional behavior. It's annoying and downright interfering.